WEST BENGAL

Budget Shows Lower Revenue Deficit

B Prasant

DESPITE the multi-faceted attack launched by the BJP-led union government on the fiscal and financial rights of the states, the West Bengal Left Front government has struggled hard to record a growth rate of 7.1 per cent of the state GDP. The state GDP is expected to grow at a faster rate of 7.6 per cent in the current financial year. The national growth rate stands at 5.6 per cent.

The budget was presented on March 15 by the state finance minister, Dr Asim Dasgupta. The size of the budget is Rs 38,518 crore.  This reflects a growth of 4.7 per cent over the last financial year.  The size of the budget will be ‘covered’ by tax revenue worth Rs 10,449 crore, and non-tax revenue of Rs 1,403 crore. These figures reflect a growth of respectively of 18.4 per cent and 30.4 per cent over the last financial year.

The plan sector has been targeted especially for increasing revenue.  The present budget aims at collecting a tax revenue of Rs 4,184 crore which is 37.5 per cent more than of the last financial year where it had stood at Rs 3,065 crore. By enhancing mobilisation of resources in general and by going in for curtailment of unnecessary expenditure, the budget deficit has been brought down to Rs 85 crore. 

The revenue deficit and revenue mobilisation ratio has been brought down to less than 54 per cent compared to 91 per cent during the last financial year.  The target is to bring it down further to 35.6 per cent.

The budget describes the attacks initiated by the BJP-led union government on the state in the fiscal and financial realms.  The union government would not bear any responsibility at all of the impact on the state budget regarding the implementation of the recommendations of the Fifth Pay commission.  The union government would not also come up with its share of responsibility as far as release of funds is concerned as per the recommendations of the Eleventh Finance Commission.

The amount of foodgrains distributed under the public distribution system in 1991 stood at 208 lakh tonnes.  After the acceleration of a series of neo-liberal economic reform programmes, the figure came down to 132 lakh tonnes in 2002-03.  The disinvestment policy of the union government has seen the closure of 27 central PSUs in the state.  This has affected more than 2.28 lakh workers and employees in an adverse manner.

The policy of liberalisation has also affected the credit-deposit ratio of the banks to the point where people in the districts are not able to get loans worth more than 25 per cent of the total amount they have with the bank.  The vast increase in imports – it stands at 11 times that of exports – has badly affected the industrial and agrarian markets, causing loss of jobs on a massive scale everywhere in the country and West Bengal cannot be an exception in this regard.  

The lack of central legislations has prevented the state LF government from going ahead with levying of service taxes.  Despite repeated requests, the president’s assent was not forthcoming to the state government’s proposal for imposing Entry Tax.  Lack of central legislation, again, has prevented the state from imposing Value Added Tax or VAT.  The state has determinedly increased it own share of tax collection by 25.2 per cent, which had stood at 8.3 per cent last year.

ALTERNATIVE POLICY

As part of the alternative policy put forth by the state LF government, the monopoly of big business and big farmers has been broken down and an environment of equality of competition has been put into practice.  The state government has emphasised its role as a welfare institution in this regard.

West Bengal, the budget notes, stands first in the country in terms of land reforms, small industries, and employment generation. It also holds the prime position as far as agricultural growth is concerned. Of the total amount of land redistributed in the country, 20.4 per cent has been done in West Bengal although the state possesses a mere 3 per cent of the total land of the country.

As per the latest available data, 10.88 lakh acres of agricultural land has been distributed among 27.78 lakh families. Among the beneficiaries, 56 per cent belong to the scheduled castes and scheduled tribes. Irrigated land stands at 67 per cent.  Bio-fertiliser off-take has increased from 210 - tonnes in 2002-03 to stand at 600 tonnes during the current financial year. Improved seed varieties are being used in 92 per cent of agricultural land.  In terms of food crops, the state is 98 per cent self-sufficient.

In the industrial sector, of the 795 industrial units, 72 per cent belong to the medium industries category.  Additional employment to the tune of 5 lakh has been generated in agriculture, pisciculture, small-and-medium industries, and through self-employment schemes. The consumer price index for workers has come down by 2 per cent in metropolitan Kolkata. The internal market of West Bengal increases at a rate of 10 per cent annually. The roads, transport, and power sectors are being constantly upgraded and strengthened as expansion takes place.

The average wage of the khet mazdoors is just under 58 rupees.  The rate of increase of wages is in fact higher than that of the consumer price index.  The purchasing power of the rural poor has increased and this is confirmed in the National Sample Survey figures released of late.

In education, the ratio of children attending school has touched 96 per cent.  Child education centres now number 17,095 compared to 13,465 last years.  The secondary education centres now stand at 1,060. 

As far as public health is concerned, death rate has come down to just over six per cent compared to the national average of over 8 per cent.  Child mortality is 49 per one thousand live births as against the national average of 64.